The great salary review: Why you should ask for a pay raise, even in a recession

Is it The Great Resignation or The Great Retre n chment? Truth be told, I’m just as confused. One minute, we are reading how employees are preparing to leave their jobs for greener pastures, the next, a well-known crypto company wasn’t just downsizing its workforce, it was rescinding job offers people had already accepted.

As an employee, it must be frustrating to feel like you are caught between a rock and a hard place. Should you play it safe, shoulder the effects of the inflation and see how you can stretch your dollar harder and further? Or, should you ask for a salary review and brace yourself for rejection and maybe be given the dreaded handshake.

“The fact of the matter is that there is still a labour shortage. The Great Resignation contributed to this as well as the reawakened labour market. Which means, if your employer is unable to support you, there most probably is another firm that might be able to deliver,” says Richa Doyle, Director of Page Personnel Singapore.

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Are we entitled to a payrise anyway?

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There are several things to unpack here. First, no one is going to pay you more for already doing the job you were hired to do. Second, with more money comes more responsibilities. Finally, employers rarely factor inflation into salaries because they don’t want to build up the expectation that such increments are a given.

Even if an employer were to adjust salaries for cost-of-living, these increments rarely keep up with actual inflation. More likely than not, wages are set based on prevailing market rates and how “in demand” an individual is.

The only way to get more dough? Score a promotion or get a better offer somewhere else.

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Get the conversation started

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If you believe you are due for a salary review, keeping quiet and hoping your manager would do the right thing is naive at best, foolish at worst. As more and more companies move to quarterly reviews, now’s the time to prepare for such a conversation with your boss.

We’ve got to be realistic here. If you’re asking for more money, you need to justify why. Are you the top salesperson? Do you have a great relationship with the big clients? Or, have you shown just how indispensable you are when it comes to helping your company stay abreast of rules and regulations? Going into this conversation with solid evidence of your great work is half the battle won.

You should also be prepared to step up and accept more responsibilities because you may not get an outright Yes. But if your manager is open to the idea of you rising to the challenge and proving yourself so that they can justify that payrise at the next review, you are off to a good start.

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But you got shut down! Now what?

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What if your manager isn’t supportive of your pitch? What if they go, “The economy is bad”, “The company is prioritising growth so we can survive this downturn”, or “You’re a good performer but I’m afraid you’re not strong enough to take on something bigger”? In short, they are not only saying No to your request for a payrise, they are cutting you off from any opportunity to fight for one.

In such sobering situations, you then need to ask if it’s time to up your game and prove them wrong or, to move on to another company that’ll better appreciate what you bring to the table. This said, would a job offer move your manager into making you a counteroffer and turn the situation in your favour?

“When it comes to counteroffers – always think long term,” Doyle advises. “If you’re just moving for a few hundred dollars but the role and opportunity isn’t too different from your current one, you have to ask if it is really worth it.”

It is tempting to think maybe your boss would come to their senses and make you a counteroffer as a way of saying they were wrong to take you for granted, but that’s unlikely to happen.

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The majority of employers would rather see this as a lack of loyalty on your part than a fault of theirs

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So, if you have an offer from another company, the decision to take it should come entirely from you. And you should consider accepting if:

The salary bump is substantial. Research shows job hoppers see a minimum wage jump of 18 to 25 percent. Even if your employer adjusts your salary to reflect cost-of-living, it is at most between 3 and 5 percent.

The job scope is bigger and you see a clear progression path. After all, a meaningful career should always have growth and feed your ambition.
The benefits are comparable, if not better. Flexible work arrangements, more comprehensive healthcare, allowance for home office setup, etc. Benefits often represent the intangible part of your package.

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In short, don’t be in a hurry to accept an offer that’s only going to pay you a few hundred dollars more.

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Doyle believes you should still try to have a compensation conversation with your current employer about your role in the long run and see if it will benefit you to stay on.

For women, talking about money can be an emotional activity. My advice is to not let thoughts like, “My manager doesn’t want to give me a raise, I mean nothing to him!” mess with your head. At the end of the day, everyone has an agenda and you just need to focus on yours.

Take stock of the situation, be objective about your prospects in your current workplace, and if you believe things won’t get better, it’s time to look after yourself and move on.

After all, companies look after themselves. You look after you.

Deborah Tan-Pink is Communications Director at Bitstamp and the co-host of the podcast Good Girls Talk About Money. You can find her podcast on Apple Podcasts and Spotify.

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